Record industry rolls on with lawsuits: first Kim Dotcom, now Pandora

[Mani]

Five major record labels have sued Pandora over failing to pay royalties for music recorded before 1972. The same record labels also sued SiriusXM satellite radio in September 2013 over similar issues.

Due to a quirk in federal law, music recorded before 1972 is not protected under US copyright. Those recordings, however, are governed by what the US Copyright Office describes as: “a patchwork of state statutory and common law. States are permitted to continue protection for pre-1972 sound recordings until 2067, at which time all state protection will be preempted by federal law and pre-1972 sound recordings will enter the public domain.â€

SoundExchange, a music rights organization, estimates that non-payment for pre-1972 recordings cost artists and labels $60 million in royalties non-payment in 2013 alone.

The companies, including Capitol Records and Sony Music, filed the copyright infringement lawsuit in New York State Supreme Court on Thursday—New York is one of the places that does have laws covering older music.

In its annual report filed with the Securities and Exchange Commission earlier this year, Pandora noted the lawsuit against SiriusXM and warned: “Similar litigation could be brought against us for similar claims. If we are sued and found liable for the violation of the exclusive rights of any pre-1972 sound recording copyright owners, then we could be subject to liability, the amount of which could be significant.â€

Pandora also noted that if it was unable to get such license, “then we may have to remove pre-1972 sound recordings from our service, which could harm our ability to attract and retain users.â€

In a statement released by the Recording Industry Association of America, Maria Elena Holly, widow of Buddy Holly, said:

Digital music companies like Pandora and SiriusXM know people love the music from the '50s, '60s and early '70s with entire channels devoted to songs from this era, including my husband's “Words of Love†(1957) and “Everyday†(1958). So how can it be that they don't pay the artists who created these popular hits? Do Buddy's fans that pay for these digital music services realize that not a penny will go to the artists or their families? Just because Buddy and the other 50s musicians recorded songs before 1972 doesn't mean their songs have no value. These companies' failure to pay the Rock and Roll pioneers is an injustice and it needs to change.